As the the remaining lease term of a Deal domestic lease diminished so does its value and therefore the value of your property. Where the lease has, beyond 125 years to run then this decrease may be of little impact nevertheless there will become a point in time when a lease has less than eighty years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should extend the lease sooner as opposed to later. The majority of flat owners in Deal will meet the qualifying criteria; that being said a lawyer can confirm if you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold residencies in Deal with over one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Lease extensions in Deal can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Deal lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
George owned a high value flat in Deal on the market with a lease of just over 72 years remaining. George on an informal basis contacted his landlord a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were George to exercise his statutory right. George obtained expert advice and was able to make an informed judgement and deal with the matter and readily saleable.
In 2013 we were approached by Ms N Cox who, having purchased a purpose-built flat in Deal in January 2009. The question was if we could approximate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical properties in Deal with an extended lease were in the region of £290,000. The average amount of ground rent was £45 collected quarterly. The lease elapsed in 2099. Taking into account 73 years remaining we calculated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 plus expenses.
In 2012 we were phoned by Mr and Mrs. B Green who, having owned a purpose-built apartment in Deal in May 2009. We are asked if we could approximate the premium could be to extend the lease by a further 90 years. Similar premises in Deal with an extended lease were worth £235,600. The mid-range ground rent payable was £60 billed yearly. The lease elapsed on 2 May 2088. Having 62 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 not including costs.